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Crawl, Walk, Run – Monday Morning Manufactured Housing Marketing and Sales Meeting

July 16th, 2018 No comments

 

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No good parent demands that an infant start to walk moments after they’re born. Development of motor skills and intellect takes time. The initial achievement for the normal baby is to learn to roll over, then to crawl, later that first step, walking, and finally a healthy child learns to run.

 

Once learned, the child doesn’t run or even walk constantly. Different activities are needed for different times. 

Once we learn to walk, we can still stumble and fall. Perfection is a goal, but it isn’t one we achieve in this life. That said, the standard should always be excellence.

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Failing to seek excellence hurt many manufactured housing in the 1990s, and it hurt numbers in the mobile home era of the business in the late 1960s and early 1970s. Let’s learn the lessons.

The D.R. Horton Homes story we spotlighted last week on the Daily Business News ought to be mandatory reading for every person that works in manufactured housing.  

Why?

Because it reminds us all that you can spend $300,000, $400,000 or more on a new residence, and that conventionally “site built” house can still have HUNDREDS of defects.

If you missed that D.R. Horton Homes story, the public version of that story is linked here. Link that version from social media. Show it to prospects, in the right way, and only at the right time.

The professional version of that D.R. Horton post is linked below, and should be read later for greater insights. This is a must for every pro, period, regardless of your job in MHVille.

Investors, Heartbroken Home Owners, Site Building Giant DR Horton, and Manufactured Housing

Note that we’ve made that point years before, when we video interviewed for MHLivingNews.com a conventional housing inspector. He spoke then about the problems he found with new homes that cost over $500,000, back at that time.  He told us then that he finds fewer errors in a manufactured home, than in conventional housing. Surprising?  

But regardless of the price, no house is perfect.

 

The High Cost of False Expectations 

The normal person who buys a car knows that it will require new tires, oil changes, brake jobs, and other maintenance.

In the RV business, initial quality is frankly an issue. Who says? Among others, a gent who used to do quite a lot of work for the RV industry, and is currently a vice president at the Manufactured Housing Institute (MHI). He told me that initial quality is an ongoing challenge for RVs.  Yet, RVs cost far more per square foot than the most expensive manufactured home on the market.

That MHI VP is not alone on the initial quality of RVs point. 

So it isn’t just site built houses. RVs, cars – or manufactured homes – that need service and adjustments.  They all do. These are facts. 

In coaching new or even seasoned sales people, the way to handle such issues is to set the right expectations as early on as reasonable with a given prospect. 

If a home being sold to a customer is an entry-level, VOG design (Vinyl over Gypsum, or wall boards that use batten strips), tell the customer at the right point and as early on as reasonable what to expect. Give them a $20 tool kit with the sale of the home, that includes an inexpensive claw hammer.

At the right time, which varies from prospect to prospect, explain that in transport, or as a house settles, that they may see some of those nails or staples pop out some, and that a batten strip can bow.   

Correcting the Record on Housing Affordability, Manufactured Home Shoppers, & MHI

Then, explain or show them how to tap that nail or staple back in.  You begin by telling them something like the following.

Can I give you a dose of reality for a few moments?” 

When they give you their ok, start with something like this.

Some of what I will share will sound negative, but facts are facts. The better you understand the facts, the happier you will be as a home owner.” 

Keep good eye contact. 

Consumer Reports, Fannie Mae, and Harvard University are among the third-party researchers that have cited for years the fact that a manufactured home can last as long as a conventional site-built housing.  That’s amazing isn’t it?  But that doesn’t mean that this or any other kind of home is perfect. ABC News is among the mainstream news media outlets that have said that giant conventional housing builders – like D.R. Horton Homes – may have hundreds of cosmetic or other defects, in a single house.”

Let that sink in for a beat or two, keep that eye contact, and then continue.

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Manufactured housing produces build entry level homes, such as the one shown above, as well as residential style homes. Entry level homes often use VOG and batten strips. This is similar to entry level cars, cells, RVs, etc. Lower cost, less expensive finish. But that entry level manufactured home must still meet all of the safety, energy and construction standards established by HUD. That’s the beauty of manufactured housing! Satisfaction with manufactured home living is well established by both federal and private reports.

There are pluses and minuses to everything. In manufactured housing, you commonly see some models of homes that are lower in cost, which often use batten strips and VOG. VOG is a fine product. VOG allows you to clean the walls without painting them. VOG is Vinyl over Gypsum. So VOG is sheetrock with a covering, similar to the sheetrock without a covering used in site built or other homes, that gets tape and texture.”

Tape and texture can get stress cracks. That’s not as common in VOG. But with VOG, you may see nails or staples that pop out. That’s normal after transport, or if a home settles.” 

Some sellers promise the moon, and fail to deliver.”

“We’d rather tell you the truth, and then you will be happier because you will have the right expectations. If you don’t already have a tool kit, and when you buy a home from us, when you close, we’ll give you a basic tool kit with your home.  We will also show you just how simple it is to tap that nail or staple back in place. Is that fair enough?” 

I’ve sold, managed the sales of, and coached others to sell the same kinds of homes – high, medium and entry level – that you have. Thousands upon thousands of homes were sold the right way. We had stellar review from customers. 

But here’s a hidden payoff. At my own dealership which sold hundreds of homes a year before it was profitably sold, I never had even one retail consumer hire an attorney.

Think about it.  Not one letter from an attorney for a retail customer. We did have a dispute or two with others in business, but not with consumers. Instead, we had routine satisfaction and referrals. That satisfaction and those referrals came to us, by doing things the right way. 

A key part of that was setting the right expectation.  What we share, we know that it works, when you do it properly.

How do you achieve that level of customer satisfaction? There are several points, but one of them is by setting the right expectation on the front end. 

The reality is that customers will find out everything in time anyway. So, why not be up front about it? 

  • Which way will the customer respect you more?
  • Which way will bring you more business?
  • Which way will cost you customers later on in life? 

We have scores of simple tips that we teach and coach clients on that result in higher satisfaction, more sales, and more referrals.

We also have sophisticated recruiting, marketing, and sales systems that perform in manufactured housing. By performance, I mean systems that when properly used are proven to attract and sell more customers who can stroke the check, or who can qualify for most any kind of good financing. 

The bottom line is simple, yet profound. “Do for others as you would have them do for you.” A Jewish Carpenter named Jesus said that, and if it was good enough for that home builder, it’s more than good enough for you and me.  

Should every plant and production center strive to do the best job they can for their price points?  

Absolutely.

 MyJobIsNotToBeEasyonPeopleMyJobistoMakeThemBetterSteveJobsQuotePhotoDailyBusinessNewsMhproNews

But be realistic. That $300,000 and up D.R. Horton Homes that ABC News spotlighted isn’t a one off. There are a number of websites and other mainstream news stories that reflect complaints against site-builders.

So, why don’t they have the image issues that manufactured housing does?

We’ll look at that question another time, but for now, you focus on setting the right expectations.

 

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Before Lou Holtz coached at Note Dame, he coached at Arkansas. In the 1978 Orange Bowl on January 2, 1978, featuring the Arkansas Razorbacks against the heavily-favored Oklahoma Sooners. The sixth-ranked Razorbacks were 10–1, but were heavy underdogs to the #2 Sooners. Holtz benched two of his best players before the game, for a rules violation. People thought he was crazy. Holtz’s team still pulled off a stunning upset win.  Holtz practiced what he preached.

Treat that customer as you’d want them to treat you. When you do, something almost like magic happens.

You’ll rarely regret it if you routinely tell the truth in an effective, and compelling way. Need more sales? Got a budget for marketing, sales, and coaching? Call or message to learn more. The ROI is terrific for marketing and sales done properly. ## (Coaching tips, marketing, sales, management, commentary, and analysis.)

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Tony is the multiple award-winning managing member of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.

Office 863-213-4090 |Connect on LinkedIn:

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7 Reasons Why Manufactured Housing is Poised to for More Rapid Growth

July 14th, 2018 No comments

7ReasonWhyManufacturedHousingIsPoisedForMoreRapidGrowthCNBCManufacturedHousingIndustryDailyBUsinessNewsMHproNewslogo

Nature abhors a vacuum. At the center of every business’ or industry’s success was the recognition of a need, followed by the steps required to fill that need.

 

The affordable housing crisis is well known and documented. What is less embraced are the causes and potential solutions, which includes manufactured homes, as well as other forms of factory-built or industrialized housing.  That’s opportunity in disguise.

The Daily Business News will spotlight today 7 Reasons Why Manufactured Housing is Poised for More Rapid Growth.

In no particular order of importance, the following are the seven reasons.

The 7 can be summed up in two words, “Money” and “information.”

1)   Record Equity. A decade after the housing/mortgage crash of 2008, the housing markets have recovered.  “The first three months of 2018 saw homeowners’ tappable equity surged by $380 billion to $5.8 trillion, the largest recorded,” states MPA, the Mortgage Professionals of America.

 

2)   There are many retailers and communities that know what the award-winning manufactured home retailer in the video below told MHLivingNews.com. Namely, that a large percentage of manufactured home buyers have first owned a conventional house. When some sell their house, they may pay cash or have more down payment to finance a manufactured home.  Some will borrow against a house in order to buy another home.

 

 

3)   The video above makes another important point for manufactured home professionals, investors, advocates, and the home buying public to know.  There are both entry-level and residential-style manufactured homes.  Both are necessary!  Each one – entry level, and residential style – benefits and complements the other. High-end producers or sellers are wise not to diminish their ‘shade and shelter’ kin, and vice versa.

 

NathanHararyMarketSnapshotAllAboutEquityFamilyFirstFundingManufacturedHousingINdustryDailyBusinessNewsMHproNews598

 

4)   Rapidly Rising Equity in Housing in the 1st quarter of 2018. Nathan Harary, Senior Loan Officer at Family First Funding tells MHProNews that “It’s all about equity.” As proof, he ticks off some specific examples of expert insights. By the way, when he says that 63 percent have a mortgage, that’s like saying that 37 percent don’t. Each kind of home owner is an opportunity in disguise for a savvy, ethical, and long-term thinking manufactured home marketers.

 

HomeownersareIntheMoney63PercentHaveMortgageFamilyFirstFundingLogoDailyBusinessNewsMHproNewslogo

When you say that 63 percent have a mortgage, that’s another way of saying that 37 percent are mortgage free.

 

5)   2018 1st quarter year-over-year growth.  Housing values rapid rise boosted equity by $1 trillion dollars in a a year. Wow!

NationalHomeOwnerEquity1stQuarter2018ManufacturedHousingIndustryMHproNewsFamilyFirstFundingLogo

A trillion dollars is equal to about 16,205,476 of the averaged priced manufactured home sold in December 2017, using Census Bureau data. So about half of that trillion dollars could pay for enough manufactured homes to meet the nation’s 8.3 million unit housing shortage, using NAR data.

 

6)   CoreLogic’s CEO’s statement.

CoreLogicPresCEOFrankMartellQuoteHomeEquityGrowFamilyFirstFundingLogoManufacturedHousingINdustryDailyBusinessNewsMHProNewslogo

 

7)   National Housing Data. The data and the trends, properly understood, are like a road map for the need for more factory-built homes.

HomePriceActivityNationallyFamilyFirstFundingLogoManufacturedHousingIndustryDailyBusinessNewsMHProNewsLogo

All of the above supports a factoid and quote that MHProNews has cited for months, and is shown below.  Namely, what the National Association of Realtor’s Lawrence Yun said about the need for more new homes.

LawrenceYunNARShort8.3MillionHousingUnitsRisingRentsHousingPricesCuredOnlyByMoreBuilding

Collage by MHProNews.

What the above comes down to, as noted previously, is money and information are the paths that must be used to fulfill the aspirations of millions.

Actionable information is motivating to a professional, and to housing seekers.

It should be noted that “poised” means “positioned.” Manufactured homes are in a position – for the 7 reasons cited above, as well as others to grow more rapidly.

So the above are not a guarantee. People, teams, and organizations are known to take a winning hand, and blow it.  The question is, what will you do with the hand dealt to you in your market?

Albert Einstein and Zig Ziglar both made similar observations.  The start of a solution is to start by understanding the problem. A need is a problem.  A problem is an opportunity in disguise.

Every challenge the industry faces – internally and externally – can debatably be met with a simple, effective and profitable solution.

There is work to be done, and opportunities to be tapped. Opportunity comes dressed in overalls. Are you ready to work for the next steps?  The linked items further below can be read for greater depth of understanding. “We Provide, You Decide.” © ## (News, analysis, and commentary.)

(Third-party images are and content are provided under fair use guidelines.)

Related References:

Investors, Heartbroken Home Owners, Site Building Giant DR Horton, and Manufactured Housing

Profits, Understanding Human Events, and Manufactured Housing

Life Hack Success Tip-Any Pro Can Do This-Monday Morning Manufactured Housing Sales, Marketing Meeting

Style or Substance? Lesson from Most Hated in America – Monday Morning Manufactured Home Sales, Marketing Meeting

What are the FACTS about Manufactured Housing Industry Traffic vs. Real Estate? MHVillage, MHProNews, Manufactured Housing Institute Data

IfPrettyPicturesVideosAloneWereEnoughMHIndustryWillOnlyAchieveItsGoalsByResovingItsCoreIssuesLATonyKovachMHProNews1

Learn more about the above, linked here.

FactoryBuiltCarsClothingAppliancesElectronicsCellsSmartPhonesHomesItJustFollowsLATonyKovachC2017MHproNewsBy L.A. “Tony” Kovach.

Tony is the multiple award-winning managing member of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.

Office 863-213-4090 |Connect on LinkedIn:
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Manufactured and Modular Housing Factoids, and Profitable Analysis

July 12th, 2018 No comments
ManufacturedModularHOusingFactoidsAndProfitableAanlysisDailyBusinessNewsModularprefabManufacturedHomeProNews

Modular home photo, from MBI website. Modular home building saves time and money over conventional housing, but tends to be less savings that HUD Code manufactured homes yields for a similar size home.

Tom Hardiman with the Modular Home Builders Association (Modular Building Institute) thoughtfully confirmed for MHProNews the data on shipments of new modular homes cited by the recent Harvard State of the Nation’s Housing in 2018 Report.

 

TomHardimanModularBuildingInstituteBisnow-postedDailyBusinessnewsModularManufacturedHousingIndustryNews_001

Tom Hardiman, Modular Building Institute, credit, Bisnow.

Accuracy in information are important for all aspects of factory home building. 

The new Daily Business News report on D.R. Horton is designed for professionals, as opposed to the general public. 

What’s more useful for the home shopper is the MHLivingNews report on D.R. Horton, that’s linked here or further below.  Notice that the kitchen models shown are from a range of HUD Code builders, including one that’s never been a client or sponsor.

You can search high or low, and still have a hard time finding a place where either MHProNews or MHLivingNews has undermined the quality of any federally certified HUD Code manufactured home.

We advocate against that ever being done.

 

We do compare cost, politics, policies, or other factors that have no connection to the quality of a builders’ homes.

 

When this writer owned a record setting MH retail center, or in the ongoing work we do with factory-built home industry clients in:

   coaching,

   videos,

   websites,

   training,

  • recruiting,

   or inspirational speaking,

we never encouraged blasting a competitor for the quality of their homes. It’s a foolish strategy for those who do. Doing that also undermines the logic of why HUD Code manufactured homes.

Have you ever noticed that MHARR seems to have a similar policy? I’ve never asked, but over a decade of observation tells me that MHARR doesn’t talk about any builder’s homes. Rather, they stick with policies and related discussions. Critiquing an association is different than critiquing the quality of a builder.

That said, we do encourage strict, factual comparisons to site built housing options.

The secret sauce for manufactured housing sales advancement is education. Professionals need to be educated. Home seekers need more education too.

 

 

Another part of the secret sauce for manufactured home success is the right kind of analysis and comparisons. Trade media can open doors that a business can’t as readily.

The more expert the trade media, the more reliable the research, the more readers can count on what they see and view.   

Every other major industry you can think of has trade media.

It is common in other industries, that trade media reports problems, and does analysis, as well as successes.

 

QuestionMarksManufacturedHOusingINdustryDailyBusinessNewsMHproNews

 

Ask Yourself This…

Stop and think. Which would YOU believe or trust more:

   An automotive, travel or tech trade site that praised everything, and never critiqued anything?

   Or would you find those tech, auto, or travel media that candidly critiqued and reported on issues, so that you can be better informed?

Isn’t the obvious answer the second option?

We’ve said on MHProNews for years that every publication in MH that has an audience has some value.

But are those that won’t honestly analyze the clearly failed “leadership” that has caused manufactured homes to be at such a relatively low level of acceptance helping or enabling the industry to make needed course corrections?

 

We Take It Too

We get a steady steam of reader comments and feedback. They range from cheers to sneers. We consider comments from readers. Everyone likes praise. But we carefully consider critical comments. What do they tell us?

It’s all part of our own reality check.

 

CritiqueHighlyVisibleEcnouragesIndividu8alsRaiseStandardsDavidDidauQuoteMastheadBlogManufacuredHousingIndustryMHProNews

Critiques, properly understood, are a way of improving performance. Every business, every sports team which aims to win does evaluations, which are a critique. “We Provide, You Decide.”

The D.R.Horton report on MHLivingNews carries the added weight of being the industry’s top publicly focused trade media.

Exposé! Heartbroken Conventional Housing Buyers? Dare to Compare Site Built with Modern Manufactured Homes

Consider sharing links to that with the general public. Consider sharing the links to the Daily Business News, and this analysis, with peers, colleagues and other professionals.  Note that many of the same points, other than HUD Code home related items, apply to modular homes. Rephrased, the quality of modular or manufactured homes will both routinely be better than what is found in conventional, site building. Not a slam, just an evidence based reality that the D.R. Horton story exemplifies. 

That’s “News Through the Lens of Manufactured Homes, and Factory Built Housing.” © On MHProNews,We Provide, You Decide.” © ## (News, analysis, and commentary.)

Footnote 1: The expression by Jim Reitzner is a generic statement periodically used by that manufactured home industry professional that seems to fit this topic; but bit should not be construed as a direct quote by him given for this column.

(Third party images, and content are provided under fair use guidelines.) Related Reports, are linked below…

ManufacturedHomeIndustry#1HeadlineNewsMHProNews

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Publisher and industry consultant, L. A. “Tony” Kovach.

By L.A. “Tony” Kovach – Masthead commentary, for MHProNews.com.

Tony is the multiple award-winning managing member of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.

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Investors, Heartbroken Home Owners, Site Building Giant DR Horton, and Manufactured Housing

July 12th, 2018 No comments
DRHortonHomesAmerciasBuilderLogoPhotoManufacturedHousingIndustryDailyBusinessNewsMHProNews

Photo of a D.R. Horton Home model in MD. 

Investors: D.R. Horton, Inc., America’s Builder, has been the largest homebuilder by volume in the United States for thirteen consecutive years,” says the publicly-traded company’s website.

 

Their website provided the following data, linked here.  The screen capture below is just part of that fact sheet.

DRHortonFactSheetPostedManufacturedHousingIndustryDailyBusinessNewsMHpronews

Click here or the image above to download the full size fact sheet.

 

Horton sells more than half the total number of housing units annually sold by the entire manufactured housing industry, and obviously at a far higher average price-point.

A report in Oct 2017, said their sales total in 2016 was $12.3 billion in revenues.

That’s more than double the retail sales total for all of the HUD Code manufactured homes sold in 2017 by the manufactured housing (MH) industry. The latest MH data can be reviewed later, at the link below.

Manufactured Home Shipments, State by State Breakdown, May 2018 Official HUD Data

Why does any of this matter to MHVille?

Fair question, let’s look.

 

The Site Built Housing Industry Reality Check  #1

ABC News did the following exposé of the host of problems found in the conventional housing industry.

This isn’t new, there are numerous other similar reports.  Check out this short one by a local news report.

 

These are similar to the kinds of problems that caused the old pre-HUD Code mobile home industry’s leaders to turn to the federal government and ask for federal standards.  Problematic pre-HUD Code mobile home builders in the early 1970s caused the builders of better homes NOT to want to be branded by those with a poor image.

The ‘quality crisis’ of the late 1960s and early 1970s led to exposés by CBS’ 60 Minutes and others.  That threatened the credibility of the then-booming mobile home business.  Are site builders heading toward a similar crisis? And will manufactured home producers, marketers and sellers be able to tap into those concerns?

MobileHomeShipmentsManufacturedHomeShipmentChartMHIAShipmentsMHIndustryChampionSkylineHUDCodeDailyBusinessNewsMHProNews

What was accomplished previously in sustainable shipment levels, can clearly be done again.

D.R. Horton is far from alone in facing such concerns among conventional, on-site builders.  There have been numerous websites over the years – example, http://www.kbhomesleak.com/kb-home-sucks-1-gone/ – that spotlight these kinds of problems with other stick builders.

The point here isn’t to trash D. R. Horton, nor any other, conventional housing builders.

Rather, it is to make a few points similar to what the National Association of Home Builder (NAHB) official interviewed in the ABC News video above made.

Namely, that housing isn’t perfect.

No product is, and that includes manufactured homes.

So why is it that conventional housing is roaring, and manufactured home shipments are snoring?

ConstructionofModestsizedHomesRemainsLimitedHarvardJCHS2018ManufacturedModularHousingDailyBuisnessNewsMHPronEws

The only JCHS graphic that specifically mentions manufactured housing. To see our exclusive review of the Harvard’s “State of the Nation’s Housing in 2018, click here or the graphic above. 

Part of the beauty of manufactured homes is that there are third-party inspections. Those avoid many of the kinds of problems being identified by site builders, noted in the videos above.

HUD Code manufactured housing consumers can take comfort in that inspection process. Furthermore, the dispute resolution process that is part of the Manufactured Housing Improvement Act of 2000 (MHIA) gives consumers a level of confidence that is frankly not found in the conventional housing world.  The MHIA of 2000 is found in the article linked below, along with other information that can be read later for greater depth of understanding on a related topic.

Two Great Laws Already on the Books NOW,  Can Unlock Billion$ Annually for Manufactured Housing Industry Businesse$, Investor$

Unlike many conventional builders, manufactured home producers are all third-party inspected. And the review process – per HUD data reveals – so few consumer complaints that it should make all manufactured home sellers proud.

The article from MHLivingNews last year spotlighted the relatively few numbers of dispute resolution complaints on HUD Code homes.

Federal Data Spotlights Manufactured Home Industry Quality, Regulatory Questions

There are so many ways to make the points to consumers that today’s manufactured homes are a good investment.

It should be noted that Horton Homes, a manufactured housing company that was based in Georgia, was not connected with D.R. Horton.

Per References for Businesses, “…the publicly-owned D. R. Horton construction firm, based in Dallas, Texas, is an entirely different company…Horton [Homes] had played a part in improving the industry’s prestige, however. For years, jokes had persisted about manufactured housing–or rather trailers, sometimes nicknamed “tornado bait.” The homes had been considered to be shoddy, unattractive, substandard, and (in the case of a tornado or even of high winds) unsafe. Starting in the 1970s, however, that began to change. In June 1976, the United States Department of Housing and Urban Development (HUD) set new safety standards for mobile home construction. In the wake of hurricanes Hugo (1989) and Andrew (1992), HUD increased its requirements, declaring that manufactured homes should be able to withstand winds of 110 m.p.h. Horton [Industries] decided that his own product should meet even higher standards, and in 1997 the Atlanta Business Chronicle reported that some Horton Homes could sustain winds of 135 m.p.h.”

 

As an interesting side-note, Texas-based Legacy Housing, Inc. states that it purchased Horton Industries manufactured housing production facilities in Eatonton, GA in a January 2016 statement.

 

The Stick-Builder Horton Website Says the Following

About D.R. Horton, Inc.

D.R. Horton, Inc., America’s Builder, has been the largest homebuilder by volume in the United States for sixteen consecutive years. Founded in 1978 in Fort Worth, Texas, D.R. Horton has operations in 79 markets in 26 states across the United States and closed 48,731 homes in the twelve-month period ended March 31, 2018. The Company is engaged in the construction and sale of high-quality homes through its diverse brand portfolio that includes D.R. Horton, Emerald Homes, Express Homes and Freedom Homes ranging from $100,000 to over $1,000,000. D.R. Horton also provides mortgage financing and title services for homebuyers through its mortgage and title subsidiaries.”

 

The D. R. Horton Takeaways for Manufactured Housing?

There are numerous top-line takeaways for manufactured housing in the D. R. Horton story. The Daily Business News on MHProNews will point to only one this morning.  It’s this.  There is a need for all true leaders in the manufactured home industry to stand up and fight for the reputation of their industry.

D. R. Horton proves you can have significant issues, and still be wildly more successful than those in our industry are today. D. R. Horton’s quality concerns arguably dwarf those of manufactured housing. D.R. Horton aggressively markets their product.

If that is obviously so, then how is it that on something as apparently simple as the use of proper terminology about manufactured homes, the MH Industry can’t get the media to get that right?  How can it be that 42 years after the first HUD Code homes were built, that the industry’s big corporate leaders can’t get many in the media to use the correct nomenclature?

Proper Definitions, Mobile Home, Manufactured Home, or Trailer House – Civil Rights, Respect, Public Policy, & Value Issues

See the related story, linked above.  The public focused story on D.R. Horton, is linked below.

Exposé! Heartbroken Conventional Housing Buyers? Dare to Compare Site Built with Modern Manufactured Homes

That’s this morning’s look at “News through the lens of manufactured homes, and factory-built housing.” © “We Provide, You Decide.” ©  ## (News, analysis and commentary.)

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“Why Advocates Need to Rethink Manufactured Home Quality,” Harvard, GSE, Genz, “High Satisfaction”

 

“Take the MH Advantage Challenge – Can You Tell the Difference?” Fisk of Sarah Edelman, Director of Duty to Serve, Single-Family Mortgage Business for Fannie Mae

 

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Associated Builder’s President Michael Bellaman says How Congress Can Keep Momentum Going

June 29th, 2018 Comments off


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The Associated Builders and Contractors (ABC) president and CEO is Michael Bellaman. Earlier this year, Bellman was celebrating the passage for the tax cuts, along with other pro-business, pro-growth policies instituted by the Trump Demonstration.

Now, 6 months after the passage of the bill that the Trump Administration calls historic, Bellman-led ABC is calling for more.

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In this regard, Bellman’s pushing for items that complement the list that the National Federation of Independent Businesses (NFIB) has, found in the prior Daily Business News report linked below.

Act Now to Make Tax Cuts for Small Business Permeant

 

From the White House Press Room…

On December 22, 2017, President Trump signed into law the first real overhaul of the U.S. tax code in more than 30 years. The Tax Cuts and Jobs Act reduced taxes for the middle class, made American employers more competitive, and ensured that all American workers are able to keep more of their hard-earned money,” said the White House press room in the release today to MHProNews.

Six months later, unemployment has fallen to 3.8 percent, and more than 500 companies have announced benefits for their workers that include pay raises, bonuses, and expanded education support,” the statement said.

Fresh from a meeting at the White House with President Trump, Bellaman lays out his case for the bright future for building in America.

The ABC CEO says there is a current need for 500,000 jobs in construction, and that it could grow over the next 2 to 3 years by another 600,000 to 700,000 jobs.

As the midterms approach, don’t be surprised if ABC works quietly or openly for more congressional representatives and U.S. Senators to support the Trump Administration’s agenda.   “We Provide, You Decide.” © ## (News, analysis, and commentary.)

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Related Reports:

President Trump Spotlights Factory Home Builder in Speech, Proven Promotion, Support of Industry Advancement

White House Signing Ceremony on Historic Pro-Growth Financial Regulatory Reform

 

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Harvard’s Joint Center for Housing Studies 2018 – Affordability, Manufactured Homes, and Modular Housing Report

June 28th, 2018 Comments off

HarvardJointCenterForHousingStudiesLogoStateofNation'sHousing2018ManufacturedHomesDailyBusinessNewsMHproNews

Since 1988, our annual State of the Nation’s Housing report has provided an overview of housing market conditions in the U.S.,” said Harvard University’s Joint Center for Housing Studies (JCHS) to the Daily Business News via a press release.

 

As we mark the 30th anniversary, this year’s report not only examines recent trends, but assesses whether and how key metrics have changed over the last three decades and serves as a yardstick to measure whether or not the nation has met its goal of producing decent and affordable homes for all,” said the JCHS statement.

 

JCHS’ Executive Summary

The inaugural State of the Nation’s Housing report in 1988 noted that the majority of Americans were well housed and some conditions have improved since then. More than 40 million units have been built over the past three decades, accommodating 27 million new households, replacing older homes, and improving the quality of the nation’s housing stock,” said the Harvard researchers’ statement.

Homeownership rates among young adults are even lower than in 1988, and the share of cost-burdened renters is significantly higher, with almost half of all renters paying more than 30 percent of their income for housing,” said the 2018 JCHS report.

Soaring housing costs are largely to blame. The national median rent rose 20 percent faster than overall inflation between 1990 and 2016 and the median home price rose 41 percent faster,” per the JCHS.  “While better housing quality accounts for some of the increased costs, higher costs for building materials and labor, limited productivity gains, increased land costs, new regulatory barriers, and growing income inequality all played major roles as well.”

To help busy professionals manage the length of the 44 page report – and keep it as relevant and useful as possible for manufactured housing industry professionals, investors, and researchers – what will follow are a series of unedited ‘pull quotes’ from the JCHS report.

Fair warning. Modular housing gets very little attention, essentially a modest mention.

HUD Code manufactured housing fares significantly better. Still, there’s not a lot of details in what follows that a well informed MHProNews reader wouldn’t already know.

So why bother?

 

4 Reasons for Factory-Built Home Pros to Read This JCHS Report:

The above noted, why read this? Simply because it’s a million-dollar road map for a variety of reasons, but let’s note 4 of them:

 

  • As noted, the university level data is like a road map – a gold-mine of the opportunities – for manufactured housing or other factory-crafted housing professionals to explore. Almost every page is a description of possible opportunities for the industry.
  • The State of the Nation’s Housing 2018 gives an independent review of data compiled by a respected institution – Harvard – has been doing for 3 decades. Rephrased, it has credibility.
  • It largely confirms or clarifies dozens of reports previously shared on MHProNews from a variety of other sources.
  • It will be an anchor for several planned reports by MHProNews that manufactured housing advocates, investors and others will be able to rely upon.

What will follow are pull quotes, without commentary. The headings will often be our phrasing, not JCHS’. While the Daily Business News will skip some sections, the meatiest material for our audience is covered in the quotated statements below.

The 2018 JCHS entire report, complete with an array of graphics and charts, will be provided at the end of this article.  We’ll conclude with a hyper-brief analysis of our key takeaway from the document. Let’s dive in.

StateoftheNationsHousing2018HarvardJCHSReportCoverLogoManufacturedModularHousingIndustryDailyBusinessNewsMHProNews

Housing Costs

“Another factor is the low level of single-family construction. Despite six consecutive years of increases, single-family starts stood at just 849,000 units in 2017, well below the long-run annual average of 1.1 million. Indeed, only 610,000 single-family homes were added to the stock annually in 2008–2017…

Along with limited land, respondents to builder surveys cite rising input costs as adding to the difficulty of constructing entry-level homes. As a result, the share of smaller homes (under 1,800 square feet) built each year fell from 50 percent in 1988 to 36 percent in 2000 to 22 percent in 2017. Of this latest drop, 9 percentage points occurred in 2010–2013 alone…

InventoriesofSingleFamilyHousingDown2017HarvardJCHS2018ManufacturedModularHOusingDailyBusinessNewsMHproNews

Unlike single-family homebuilding, multifamily construction ramped up quickly after the crash as rental demand surged. From a low of 109,000 units in 2009, construction of multifamily units peaked at 397,000 starts in 2015 and accounted for more than half the gains in housing starts over that period. However, the multifamily construction wave is now moderating, with starts down 1 percent in 2016 and 10 percent in 2017…

This slowdown comes in response to both weaker overall rental demand and increasing slack at the upper end of the market…

Indeed, the cumulative effect of strong growth in housing costs and modest gains in household incomes has left nearly half of today’s renters with cost burdens, including a quarter with severe burdens. The rising cost of homes for sale also raises downpayment and closing costs, making it more difficult for individuals and families to make the transition to owning…

TotalHousingStarts2017SingleFamilyMultieFamilyHOusingSalesHarvardJCHS2018ManufacturedModularHOusingIndustryDailyBUisnessNewsMHproNews

National efforts are necessary to close the affordability gap. Housing policymakers have many opportunities to address the cost side of the equation, including the increasing size and quality of homes; lack of productivity improvements in the residential construction sector; escalating costs of labor, building materials, and land; and barriers created by a complex and restrictive regulatory system. However, tackling this broad mix of conditions will require collaboration of the public, private, and nonprofit sectors in a comprehensive strategy that fosters innovation in the design, construction, financing, and regulation of housing…

But even if successful, these efforts will not produce decent, afford- able homes for the millions of households that simply cannot pay enough to cover the costs of producing that housing. For these families and individuals, there will always be a need for public subsidies. The federal government’s failure to respond adequately to this large and growing challenge puts millions of households at risk of housing instability and the threats it poses to basic health and safety. Many state and local governments are doing their part to expand assistance, but a more robust federal response is essential to any meaningful progress in combatting the nation’s housing affordability crisis…”

 

HighLevelsMultiFamilyHousingHarvardJCHSManufacturedModularHOusingIndustryDailyBUsinessNewsMHProNews

Page 8 Before Manufactured Housing Gets Mentioned

(Bold Added for Emphasis. one editorial note is made)

“Nonetheless, entry-level housing still accounts for a small share of new construction. Only 163,000 small single-family homes were completed in 2016, or 22 percent of single-family construction— down significantly from the 33 percent share averaged in 1999–2007. Moreover, manufactured home shipments totaled just 93,000 units in 2017, far below the 291,000 annual average in the 1990s and even the 137,000 annual average in the 2000s

ConstructionofModestsizedHomesRemainsLimitedHarvardJCHS2018ManufacturedModularHousingDailyBuisnessNewsMHPronEws

The only JCHS graphic that specifically mentions manufactured housing.

“Modest-sized homes are considerably more affordable for first-time and middle-market buyers. According to the Survey of Construction, the median price for a small home sold in 2016 was $191,700. The average sales price for a new manufactured home in 2017 was even lower, at $72,000. By comparison, the median price for all other single-family homes was $324,700 in 2016…

“With few additions of smaller units, most modestly priced homes are found in the existing housing stock. Indeed, small homes make up nearly half of single-family homes. In 2015, there were 37.3 million single-family homes under 1,800 square feet. The stock of small homes is generally older, with nearly two-thirds (65 percent) built before 1980 compared with 43 percent of larger homes…”

Manufactured housing is prevalent primarily in the South, where some 58 percent of the 6.6 million units nationwide are located. Another 21 percent are in the West, 14 percent in the Midwest, and just 7 percent in the Northeast. Nearly two-thirds of manufactured housing shipments between 2009 and 2017 were also to the South.”

Daily Business News Notice: A more common figure used for all pre-HUD Code and post-HUD Code MH is roughly 8.8 million units.  What possibly explains the difference?  Because about 1 out of 5 MH are mobile homes, not manufactured homes.  We’ve reached out to Harvard and ask for that number to be clarified, and will update once received.

As a result, manufactured homes make up 9 percent of the total housing stock in the South, with especially large shares in South Carolina (16 percent) and in West Virginia and Mississippi (14 percent each). While the share in other regions is only 4 percent, a few states also have high concentrations of manufactured housing, including New Mexico (17 percent) and Wyoming (13 percent). Manufactured housing also provides 14 percent of homes in non-metro communities, more than double the share in the country as a whole.”

YoungAdultsFarLessLikelyMoveThanPriorGenerationsHarvardJCHS2018ManufacturedHousingIndustryDailyBUisnessNewsMHproNEws

4 Prime Factors Hamper Housing Growth

“First is the shortage of skilled workers. In a 2017 survey of homebuilders, 82 percent of respondents cited the cost and availability of labor as a significant problem…

Second, the cost of building materials has risen…”

Third, developed land has become scarcer. Metrostudy data for 98 metro areas indicate that the number of vacant developed lots declined from 1.26 million in 2008 to just 802,000 in 2017…

Finally, local zoning and other land use regulations can reduce the amount of new construction by constraining the type and density of new housing allowed…

MillenialsMovingtoSomeManufuredHomeFriendlyStatesHarvardJCHS2018ManufacturedHousingIndustryDailyBUisnessNewsMHproNEws

 

Modular housing, constructed in factory conditions before being transported and assembled on site, could provide at least part of the answer. Including the value of land, the median price for a new modular unit was $217,200 in 2016—nearly $90,000 less than for a new site-built home. To date, however, homebuilders have been slow to adopt this innovation, with only 15,000 modular homes added in 2016. Indeed, modular housing has never accounted for more than 4 percent of single-family construction in the United States. By comparison, modular housing accounts for 9 percent of new homes in Germany, 12–16 percent in Japan, and 20 percent in the Netherlands.”

HomeOwnershipRates1983to2017RisingIn2017HarvardJCHSManufacturedModularHomeIndustryDailyBuisnessNewsMHproNews

It is interesting to note that the rate of home ownership began to rise during the time after the 2016 election. Several confidence surveys have reflected growing consumer and business confidence, which has yielded more home purchases vs. renting.

 

Housing – The Outlook

“The housing sector faces significant challenges in the short term. Labor shortages, rising materials costs, limited land availability, and land-use regulations are all holding down growth in new residential construction. Meanwhile, inventories of existing homes for sale are at all-time lows, pushing up prices and making homebuying more difficult, especially for low- and moderate-income households…

With its oldest members now in their late 20s and early 30s, the millennial generation is forming new households in greater numbers and moving to different states in search of opportunity. At the same time, nearly 10,000 baby boomers turn 65 every day, raising the average age of US households. Although wealth is growing, homeowners and those at the top have captured most of the gains, and millions of households have little or no wealth. Going forward, immigration will become an increasingly large, albeit unpredictable, source of population growth and therefore housing demand…”

HarvardJCHS2018AffordabilityByMonthlyPaymentsByMetroAreaManufacturedHousingIndustryDailybuisnessNewsMHproNews

Immigration and Housing

“According to Census Bureau data, the number of foreign- born households more than doubled from 7.7 million in 1990 to 17.8 million in 2016, accounting for more than a third of the growth in households over that time…”

 

Housing and Minorities

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“Minorities made up half of the nation’s low-wealth households in 2016, up from 39 percent in 1995. They also accounted for more than three-quarters of the growth in low-wealth households between 1995 and 2016. Indeed, as the number of minority house- holds increased over this long span, the shares with low wealth remained consistently high at 52 percent for blacks, 49 percent for Hispanics, and 30 percent for Asians and other minorities. Meanwhile, the share among whites also remained steady at a relatively low 22 percent…”

 

Interstate Migration

“Resuming past trends, total net domestic migration to the Southeastern states of Florida, Georgia, and the Carolinas rebound- ed from a low of 86,000 in 2009 to 317,000 in 2017. Meanwhile, domestic outflows from the Northeast and Midwest continued to increase in 2017. The three states with the largest net domestic outflows—California, Illinois, and New York—lost 443,000 residents to domestic migration in 2017, more than double the 207,000 net losses in 2011…”

 

Homeownership Rates

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“The national homeownership rate ticked up in 2017 for the first time in 13 years, buoyed by growth in the number of homeowner households. Despite the ongoing rise in home prices, low interest rates have helped to keep monthly housing costs relatively affordable for new homeowners. Still, the upward climb of interest rates, limited inventory of homes for sale, widespread increases in student loan debt, and insufficient savings for downpayments raise important concerns about the ability of many potential buyers to access homeownership…”

 

 

Rising Prices but Relative Affordability

“Continuing a steady upward climb, the nominal median sales price of existing homes increased from $233,800 in 2016 to $247,200 in 2017…

 

In the high-cost Los Angeles market, for example, a household with the area median income would be able to afford the monthly mortgage payments on only 11 percent of recently sold homes. And because these homes include studio apartments and other small units suitable for only one or two people, the affordable options for families are even more limited. By contrast, even a low- income (bottom-quartile) household in Pittsburgh would be able to afford 26 percent of recently sold homes. Such dramatic differences in affordability contribute to large disparities in homeownership across metro areas. Of the nation’s 50 largest metros, Pittsburgh has the highest homeownership rate of 70 percent, while Los Angeles has the lowest rate of 48 percent…”

 RealHomePricesRisingsince2000HarvardJCHS2018manufacturedmodularhousingIndustryDailyBusinessNewsMhpronEws

Financing

“The FHA and VA shares of home purchase loan originations have also leveled out in recent years following a significant jump during the foreclosure crisis (Figure 24). Indeed, even as the number of 1–4 unit, first-lien, owner-occupied mortgage originations rose from 2.7 million in 2013 to 3.5 million in 2016, the FHA share remained near 20–25 percent. While down sharply from the high of 41 percent in 2009, the FHA share is still well above the 6 percent low in 2005. The VA share held at 10 percent in 2016, up from 2 percent in 2005. Meanwhile, the conventional share of originations stayed close to 60 percent…”

harvardJCHS2018LowestIncomeRentersOutnumbersupplyTheyCanAffordManufacturedHOusingIndustryDailyBuisnessNewsMHproNews

As a reminder to MHProNews readers, the GAO reported that manufactured housing is less costly than typical rent, so this type of data, while troubling for the nation, is an opportunity for manufactured housing industry professionals and investors.

Rent vs. Own

“…However, survey evidence points to continued strong interest in homeowning. The 2018 Survey of Consumer Expectations found that 67 percent of renters would prefer or strongly prefer to own homes assuming they had the financial resources to do so. Only 19 percent would prefer or strongly prefer to rent. Moreover, 61 percent of renters think buying a home in their ZIP code today is a somewhat or very good investment, and just 12 percent believe it is a somewhat or very bad investment…

The Survey of Consumer Finances shows that the median net worth of renters was just $5,000 in 2016, about the same in real terms as in both 1995 and 2007. Moreover, fewer than one in three renters had more than $10,000 in financial assets, and only 21 percent had more than $25,000. As a result, only a small share would be able to cover even a 3.5 percent downpayment and 2 percent closing costs on a median- priced home, which amounted to $13,596 in 2016…”

 RentalHousingIncrasesModerateHarvardJCHManufacturedModularHOusingIndustryDailyBUisnessNewsMHproNews

Rentals

“There are signs that the rental market is cooling, although primarily at the upper end. The number of multifamily starts declined slightly over the past year, and expanding supplies of new luxury apartments pushed up vacancy rates, helping to slow rent growth. Although the number of high-income renters is still growing, lower rentership rates among key groups—particularly younger households—may indicate a turn toward homeownership. Meanwhile, the supply of rentals affordable to the nation’s lowest- income households continues to shrink…

The Survey of Construction indicates that nearly half of the rentals completed in 2016 were in buildings with 50 or more units, compared with just 13 percent in 1999. Most other new units were in buildings with at least five apart- ments. In addition, 86 percent of new apartments in 2016 were in properties with swimming pools, up from 69 percent in 1990. Some 89 percent of new units in 2016 also had in-unit laundry services, significantly higher than the 61 percent share of existing units with this amenity…

Both rising construction costs and added amenities have pushed up asking rents. The nominal asking rent for new apartments increased average rents for new units in certain major metros (including Chicago, Miami, and Washington, DC) were $2,000 or higher.”

HarvardJCHS2018appreciationofRentalPropertiesVsSingleFamilyHouisngDailyBusinessNewsMHproNEws

Several sources have pointed to appreciation in manufactured housing too, but that isn’t addressed in this report.  There is a marked rise in the value of manufactured home land-lease communities in recent years, but that is also not mentioned in this report..

Easing at the High End of Rentals

“The national vacancy rate for all rental units averaged 7.2 percent in the year ending in the first quarter of 2018, up 0.3 percentage point from a year earlier. But the rate for rental units built since 2010, as measured by the Housing Vacancy Survey, hit 21 percent in 2017. While not unprecedented compared with the rates for similarly new units in 2007 and 2008, this high vacancy rate far exceeds the 15 percent reported a year earlier…”

 

Shortfall in Lower Cost Rentals

“The nation’s supply of low-cost rental housing shrank significantly after the Great Recession and has remained essentially unchanged since 2015. A National Low Income Housing Coalition study found that for every 100 extremely low-income renters, only 35 rental units were affordable and available in 2016—a nationwide shortfall of more than 7.2 million units (Figure 29). Conditions for very low-income renter households were little better, with 56 affordable and available rentals per 100 households…”

 

Housing Cost Burdens

“More than 38 million US households have housing cost burdens, leaving little income left to pay for food, healthcare, and other basic necessities. As it is, federal housing assistance reaches only a fraction of the large and growing number of low-income households in need. Between the shortage of subsidized housing and the ongoing losses of low-cost rentals through market forces, low-income households have increasingly few housing options. Meanwhile, the rising incidence and intensity of natural disasters pose new threats to the housing stocks of entire communities…

About a third of the households in metropolitan areas struggle to find affordable housing (Figure 35)…

 

Threats To The Affordable Supply

“The National Low Income Housing Coalition reports that the gap between supply and demand for rental units affordable and avail- able to very low-income households is 7.7 million…”

 

Homelessness

“HUD’s Annual Homeless Assessment Report shows that nearly 554,000 people were living in shelters or on the street on a given night in January 2017…”

 

State and Local Initiatives

“According to the National Low Income Housing Coalition database, about 100 state and local programs provide either tenant-based assistance or capital support for affordable rental housing development…”

 

Housing Losses to Natural Disasters

“The 16 major disaster events in 2017 caused a record-setting $306 billion in damages. These events caused destruction of hundreds of thousands of homes and widespread displacement of households across California, Florida, Puerto Rico, and Texas. In Puerto Rico alone, storms destroyed or severely damaged an estimated 472,000 housing units…

FEMA direct assistance filled some of the gaps for households without flood insur- ance, providing financial help for 1.6 million households…

The rebuilding process has its own challenges. The three states with significant disaster damage last year—California, Florida, and Texas—have large populations of undocumented immigrants, households that are unlikely to apply for assistance in fear of depor- tation. In Puerto Rico, relief is complicated by the fact that much of the housing stock was built without permits or without regard to building codes…

Recovery will no doubt be long…”

 

MHProNews Analysis in Brief

The National Association of Realtors (NAR) Chief Economist Lawrence Yun has noted before that the nation needs some 8.3 million housing units.  What Harvard’s annual report indicates are an array of other facts that point to tens of millions of possible opportunities for forward thinking HUD Code manufactured housing and modular builders.

 

LawrenceYunNARShort8.3MillionHousingUnitsRisingRentsHousingPricesCuredOnlyByMoreBuilding

Collage by MHProNews.

 

Earlier today, in the Manufactured Housing Association for Regulatory Reform (MHARR) noted their request to have multi-family housing units approved by HUD.

Manufactured Housing Program Review Addressed by HUD Secretary Carson during Oversight Hearing

Harvard didn’t in this report look at specific issues such as acceptance, financing, political, zoning, or any other reasons why manufactured housing wasn’t performing better than it is. That said, their report uses correct terminology, and is on balance, respectful of the industry. Harvard’s Eric Belksy has been cited before as saying he expected manufactured housing to surpass conventional housing by 2010.  We know that didn’t happen, some of the debatable reasons why are linked in related reports below.

But the bottom line is this.  There are millions of housing units needed now, and millions more that will be needed in the years ahead.  With the proper approaches, the opportunities are available. With hundreds of billions in capital pouring into the U.S. the best time in about 2 decades to tap those opportunities may be right now.

The entire report is available at this link here.  “We Provide, You Decide.” © ## (News, commentary, and analysis.)

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Related Reports:

Celebrate National Home Ownership Month, with 26 Cool Prefab Cribs, a $1 Billion Dollar Hybrid Mansion, 4 Fun Videos

Evolutionary American Dream, from Tiny Trailer Houses, Mobile Homes, to “Amazing” Modern Manufactured Homes

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New High Mortgage Rates, Latest Core-Logic Housing Price Data

June 27th, 2018 Comments off

RisingInterestRatesPlusLatestCoreLogicCaseSchillerHouiingPriceTrendsandDataManufacturedHomeIndustryMHProNews

The S&P CoreLogic Case-Shiller 20-city home price index moved up 6.6 percent from a year earlier.  Housing price increases in Seattle, Las Vegas and San Francisco were at a double digit clip, the organization said in a release to the Daily Business News.

 

U.S. home prices rose in April from a year earlier, lifted by bidding wars in many cities where would-be buyers fought over a sparse supply of homes.

In April, Seattle led the way with a 13.1% year-over-year price increase, followed by Las Vegas with a 12.7% increase and San Francisco with a 10.9% increase. Nine of the 20 cities reported greater price increases in the year ending April 2018 versus the year ending March 2018,” the S&P CoreLogic Case-Shiller release stated.

FREDCaseschilelrHousingIndexManufacturedHousingIndustryDailyBusinessNewsMHProNEws

Prices rose even as home sales fell and mortgage rates climbed,” noted Newsmax.

Mortgage rates reached a seven-year high in late May of 4.77 percent, before declining this month. As of last week, the 30-year fixed mortgage rate averaged 4.57 percent, according to Freddie Mac. A year ago, it was 3.9 percent.

FREDCaseschilelrHousingIndexNationalManufacturedHousingIndustryDailyBusinessNewsMHProNEws

The economy is growing and the unemployment rate is at an 18-year low, which typically would point to stronger home sales,” noted Newsmax.

 

Analysis by S&P…

Home prices continued their climb with the S&P CoreLogic Case-Shiller National Index up 6.4% in the past 12 months,” says David M. Blitzer Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “Cities west of the Rocky Mountains continue to lead price increases with Seattle, Las Vegas and San Francisco ranking 1-2-3 based on price movements in the trailing 12 months. The favorable economy and moderate mortgage rates both support recent gains in housing. One factor pushing prices up is the continued low supply of homes for sale. The months-supply is currently 4.3 months, up from levels below 4 months earlier in the year, but still low.”

Americans are increasingly turning to newly-built homes,” per Newsmax, “where sales jumped 6.7 percent in May. But higher prices and fewer existing homes to choose from are cutting many Americans out of the housing market.”

 

Manufactured Housing Signficance?

Many of these conditions – such as interest rising rates – are historically those that would lead to an increase in manufactured home sales.

ManufacturedHomeShipmentsVsNewExistingHomeSalesStaartsManufacturedHouisngIndustryDailyBusinessNEwsMHPronews

Facts are facts. They are neutral measures of reality. Once facts and their causes are understood, then the opportunities can be tapped. What the above means is that the typical retailer could potentially be selling 10x (+/-) more homes. a typical market

Nevertheless, manufactured home production and sales are still at historically low levels.

MobileHomeShipmentsManufacturedHomeShipmentChartMHIAShipmentsMHIndustryChampionSkylineHUDCodeDailyBusinessNewsMHProNews

What was accomplished previously in sustainable shipment levels, can clearly be done again.

In a release to MHProNews, the Manufactured Housing Association for Regulatory Reform (MHARR) attributed some of the woes for the still-low sales level to a lack of effective post-production national industry leadership.

MHARR hailed the start of a new communities focused post-production association.

New Manufactured Home Industry National Association Related Statements

The independent producers association based in Washington, D.C. nevertheless urged that the rest of the industry’s post-production companies should work to organize their own association.  That’s a call that award-winning Bob Crawford, president of Dick Moore Housing and others in the retail side of the HUD Code home industry support.

The new MH Communities association, and the call for a new retail post-production association follows comments by MHI award winner, Marty Lavin, who said that the Arlington, VA based trade group only works for the interests of the “big boys.”

‘Tip of Iceberg’ – Rick Rand; Marty Lavin, Communities have ‘No Confidence’ in Manufactured Housing Institute, New National Trade Group Announced

Lavin added that MHI is useful for smaller firms only to the extend that a small firm’s need happens to mirror that of a larger company.  For more details, see the related reports, linked above and below. (News, analysis, and commentary.)

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Related Reports:

Manufactured Home Communities, Retailers, Developers Face Disruptive, Troubling Trend

NorthStar and Manufactured Housing Radix

Only 3 Options – the Elephant in the Room

 

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NAR’s Lawrence Yun Raises Alarm for New Housing Crisis, MH Import?

May 30th, 2018 Comments off

LawrenceYunMay2018InventoryHousingOnMarketManufacturedHousingDailyBuisnessNewsMHproNews

The housing industry today is facing a different kind of crisis:
not enough homes for sale
.”
– Lawrence Yun, Forbes Contributor.

 

A decade ago, the housing sector was in a mess. The mistakes of easy subprime lending resulted ultimately in the catastrophic collapse of the housing sector. Home values collapsed by a third nationwide, and the inventory of unsold homes spiked to unprecedented heights. Miami, for example, at one point was said to have 30 years of housing inventory.” – said Lawrence Yun, Forbes contributor and chief economist for the National Association for Realtors (NAR).

GoodEconomyJobAdditions90StraightMonthsUnemployment3.9PercentHighStockMarketHighNetWorthWagesRisingYunNARMay2018ManufacturedHousingMHProNEws600

Fortunately, after many years of sobering up, with proper lending and consistent job creations in the economy, the housing market has regained some health, with higher home sales and a very low foreclosure rate. However, the industry today is facing a different kind of crisis: not enough homes for sale,” Yun wrote just days ago.

5PointsToBoostHousingYunNARMay2018ManufacturedHousingIndustryDailyBusinessNEwsMHproNews

The inventory of homes on the market last year in 2017 was one of the tightest ever. In early 2018, it is even worse. In the first quarter, the number of homes on the market averaged 1.59 million, which is down 8.4% from the same period one year ago,” Yun stated. “Strictly focusing on single-family home listings, this is the lowest inventory since the tracking of the data from the early 1980s.”

GoodEconomyJobUnempoyemntHighStockHighNetWorthWagesRisingYunNARDailyBusinessNewsMHproNews600

This acute housing inventory shortage has fired up home prices. The median home price has risen by 40% in the past five years and is still rising strongly, with a 6% annualized gain in March. Such a rapid gain in home values at a time when wages are rising by only 2% to 3% a year is measurably cutting into affordability. With the Federal Reserve set to raise its short-term interest rates several more rounds over the next two years and unwind some of its prior asset purchases, longer-term interest rates, including that of mortgages, will surely rise and hence further hamper affordability,” the NAR economist stated.

HomePriceExpectationYunNARMay2018ManufactuerdHousingIndustryDailyBusnessNewsMHProNews600

Interestingly, though, home-buying demand remains super-robust. The steady build-up in household formations following the recession continues. Many of the new households have not purchased a home, as evidenced by the still historically low homeownership rate,” Yun explained, adding, “Pent-up housing demand, therefore, is large.”

LawrenceYunNARShort8.3MillionHousingUnitsRisingRentsHousingPricesCuredOnlyByMoreBuilding

Not New, but Important to MHVille

The Daily Business News has reported on Yun’s keen real estate and housing insights for years.

His previously published statements include the quote below, where he says that builders must get busy to get beyond the current housing crunch.

This ought to be a no-brainer for factory-built housing professionals.  But due to years of several different internal industry issues, coupled with regulatory challenges, and public perceptions, manufactured housing has been kept at historically low ebb.

Now, emerging technology could be poised to supplant modular and some of the potential output of manufactured housing industry professionals (see related reports, further below.)

MostMenAppearnNeverConsideredWhatHouseIsNeedlesslyPoorAllTheirLivesHenryDavidThoreauManufacturedHomeLivingNews

For newcomers to the website not familiar with modern manufactured homes, learn more by clicking the image above or the link here.

The realities undercut some of the logic that the Manufactured Housing Institute (MHI) Ducker Worldwide concepts have called for, and their so-called “new class” of manufactured homes.

The image issues from an ongoing series of largely unrebutted industry issues rounds out the problems faced by manufactured housing.

Part of the opportunity-in-disguise must be the investment by industry pros at the location level of the time, talent, and treasure to tap the opportunities provided by an 8.3 million affordable housing units needed.

Another element of the solution ought to be the establishment of new, post-production representation of the independent companies of the industry.

The Ultimate Manufactured Home Industry Fact$, Data, and Insights – Bullets plus at-a-Glance Infographic

What arguably won’t work is more of the same.  The status quo on a range of issues has led the industry’s homes to the status of 3rd, 4th or 5th choice housing for millions.  When the industry’s quality is better than its ever been, it is incongruous.

Yun’s recent presentation of 2018 housing data, from which the slides above are taken, is found at the download linked here. “We Provide, You Decide.” © ## (News, analysis, and expert commentary.)

(Third party images, and cites are provided under fair use guidelines.)

Related Reports:

High-Rise Manufactured Home Stackable Towers, Compete with Modular/PreFabs, Density at Lower Cost

GSE Asked: Will Manufactured Housing Overtake Conventional Homebuilding?

George Allen Blasts MHI, NCC Ignoring Own, Spencer Roane, SECO, COBA7, Tom Lackey Controversies

Code of Conduct – Good or Bad News, and Home Selling – Monday Morning Manufactured Housing Sales, Marketing Meeting

Emerging Building, Construction Technologies Poised to Disrupt Housing, Developing, and More

Survey Top 2017 PreFab, Modular, Tiny and 3D Printed Housing News Stories

Clayton Homes, Top 25 Manufactured Housing Industry Report, Trend Lines

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Emerging Building, Construction Technologies Poised to Disrupt Housing, Developing, and More

May 29th, 2018 Comments off

DroneBuildingWallDailyBusinessNewsMHProNews

This 10-minute video will show you some technologies that you will be familiar with, such as 3D Printing.

 

But it will also introduce you to technologies that you may not be familiar with at all.  This new TechZone video was posted earlier in May 2018, and it already boasts over a million views.

From:

  • patio and road paving systems,
  • to tear down tech,
  • 3D printing,
  • to wall building drones,
  • robots that build walls faster than humans,
  • and more

this is a video that forward thinkers in the manufactured and modular housing industry will want to carefully digest.

We have a follow up Daily Business News report pending on a related process that is poised to launch later this year, or early in 2019.  It is a must for factory builders.  Stay tuned. ## (News, analysis, and expert commentary.)

(Third party images, and cites are provided under fair use guidelines.)

Related Reports:

Survey Top 2017 PreFab, Modular, Tiny and 3D Printed Housing News Stories

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1) To sign up in seconds for our MH Industry leading emailed news updates, click here.EmailedMHProNewsHeadlineNewsDailyBusinessNews

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3) Marketing, Web, Video, Consulting, Recruiting and Training Resources

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Soheyla is a managing member of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.

 

HUD and Census Bureau Report, New Housing Sales, April 2018

May 24th, 2018 Comments off

HUDCensusBureauReportsApril2018ResidentialHousingManufacturedHomeDailyBUisnessNewsMHproNews

WASHINGTON, D.C. The U.S. Department of Housing and Urban Development (HUD) and the U.S. Census Bureau jointly announced the following new residential sales statistics for April 2018,” said the joint release to the Daily Business News.  

 

New Home Sales 

Sales of new single-family [conventional] houses in April 2018 were at a seasonally adjusted annual rate of 662,000. This is 1.5 percent (±11.8 percent)* below the revised March rate of 672,000 but is 11.6 percent (±23.7 percent)* above the April 2017 estimate of 593,000,” per their statement.

 NewResidentialHomeSalesApril2018HDCensusBureauManufacturedHousingIndustryDailyBusinessNewsMHProNews

 

Sales Price

The median sales price of new houses sold in April 2018 was $312,400. The average sales price was $407,300.  The trend lines are as shown. 

Those prices included the land.

 TrendLinesNewResidentialHomeSalesApril2018HDCensusBureauManufacturedHousingIndustryDailyBusinessNewsMHProNews

 

For Sale Inventory and Months’ Supply

The seasonally adjusted estimate of new houses for sale at the end of April was 300,000. This represents a supply of 5.4 months at the current sales rate,” the two federal agencies said.

 

CurrentManufacturedHousingSalesDailyBusinessNewsMHProNews

For whatever reasons, the residential housing sales data is not paired by the two agencies with manufactured housing data. The charts above are being provided by MHProNews for ease of reference by industry professionals.

The monthly housing report is distinct from the manufactured housing shipments data. 

2017AverageSalesPricesNewManufacturedHomesByRegionDailyBusinessNewsMHProNews

Some of that information is found above and more is linked below. ## (News, analysis, and commentary.)

(Third party images, content are provided under fair use guidelines.)

Related Reports:

HUD Code Manufactured Home Shipments, Housing Production – March 2018 Data

Fed – Atlanta – Projects Record GDP Growth for U.S., the Detail$, MH Industry Outlook

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3) Marketing, Web, Video, Consulting, Recruiting and Training Resources

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Soheyla is a managing member of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.